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Facts
The assessee, engaged in regular business activities, had cash deposits during demonetization that were added by the lower authorities under Section 69A read with Section 115BBE. The assessee claimed these deposits represented business turnover, and the revenue could not dispute the assessee's overall turnover. However, the assessee failed to discharge the onus of proof.
Held
The Tribunal held that while the addition of Rs. 29,17,000/- was disputed, a lump sum addition of Rs. 3,00,000/- representing the profit element in the cash sales would be just and proper, with a rider that it should not be treated as a precedent. The Tribunal also noted that Section 115BBE applies only to transactions after 01.04.2017.
Key Issues
Whether cash deposits during demonetization, claimed as business turnover, are subject to addition under Section 69A read with Section 115BBE, and what is the appropriate profit element to be added if the onus of proof is not fully discharged.
Sections Cited
143(3), 69A, 115BBE
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, DELHI BENCH ‘SMC’, NEW DELHI
Before: Sh. Satbeer Singh Godara
Asstt. Year : 2017-18 Sh. Tarunesh Bansal, Vs Income Tax Officer, B-2/41, Phase-II, Ashok Vihar, Ward-34(4), Delhi-110052 Delhi-110001 (APPELLANT) (RESPONDENT) PAN No. AGVPB2564P Assessee by: Sh. Somil Aggarwal, Adv. Revenue by : Sh. Akhilesh Kumar Yadav, Sr. DR Date of Hearing: 02.06.2025 Date of Pronouncement: 02.06.2025 ORDER
This assessee’s appeal for Assessment Year 2017-18, arises against the CIT(A)/NFAC, Delhi’s DIN & order No. ITBA/NFAC/S/250/2024-25/1074407405(1) dated 12.03.2025, in proceedings u/s 143(3) of the Income Tax Act, 1961 (in short “the Act”).
Heard both the parties at length. Case file perused.
Coming to the sole substantive issue between the parties regarding correctness of both the learned lower authorities’ action making section 69A r.w.s. 115BBE addition of Rs.29,17,000/-, a perusal of the case file indicates that the assessee herein is engaged in his regular business activities of delay in stationary and other related items whose cash deposits during demonetization only have been added forming subject Tarunesh Bansal matter of adjudication. The Revenue could hardly dispute that even the learned assessing authority has accepted the assessee’s turnover of Rs.4,00,00,000/- excluding demonetization period in the relevant previous years. And also he had declared returned income from the very business of Rs.9,79,410/- which stands duly assessed.
Learned counsel further invites the tribunal’s attention to the assessee’s P & L account and other relevant entries in the regular books to buttress the point that his cash deposits infact represents business turnover only. The facts however remains that he has not discharged his onus to this effect before the learned lower authorities. Be that as it may, it is thus deemed appropriate in the larger interest of justice that a lump sum addition of Rs.3,00,000/- only representing the assessee’s profit element in the above cash sales, would just and proper with a rider that the same shall not be treated as a precedent. The assessee gets relief of Rs.26,17,000/- in other words.
So far as assessee’s assessment under section 115BBE is concerned, we quote S.M.I.L.E Microfinance Limited Vs. The ACIT CC-1 in W.P.(MD) No.2078 of 2020 & W.M.P. (MD) No. 1742 of 2020 held that the said provision applied for transactions done on or after 01.04.2017 only.